Foreign Corrupt Practices Act Essay

1799 Words Apr 21st, 2011 8 Pages
Foreign Corrupt Practices Act In today’s ever changing and competitive modern world of business, it is critical for the companies to have activities internationally. In order to prohibit frauds and illegal activities, several acts and documents have been elaborated. One of the documents is Foreign Corrupt Practices Act that has been enacted in the 1970’s, as a result of SEC investigation of several U.S. companies that made illegal payments to foreign governmental officials, politicians, and political parties (Barnes 73). The FCPA had a critical impact on the way U.S. firms do business. Companies that did not comply with FCPA have been subject of criminal and civil enforcement actions that later resulted in huge fines and sentences for …show more content…
Over past several years the guidance on the FCPA provision has steadily grown. However, companies do not consider all provision, and are charged for several unlawful transactions. Due to aggressive and potentially controversial interpretation of the FCPA, there are lots of companies under ongoing investigations. For instance, Imperial Metal Industries and its subsidiary Control Components, Inc. are considered to violate anti-bribery provision of the FCPA, and related charges based on the conduct of former employees who paid bribes to countries such as China, Brazil, India, and Malaysia. Control Components, Inc designs, manufactures, and supplies valve systems for power generation, oil and gas, petrochemical, and pulp and paper facilities worldwide. Department of Justice has obtained indictments against six former Control Components, Inc. executives related to violation of the anti-bribery provision of FCPA who are now waiting for trial. Moreover, two other former executives have pleaded guilty to related charges (“FCPA Digest”). Previously, in August 2007, Imperial Metal Industries announced that it had initiated an internal investigation of irregular payments associated with certain Control Conglomerate, Inc. contracts and had notified government authorities (“FCPA Digest”). Over the past several years, the number of FCPA matters pursued by Department of Justice and SEC has steadily increased. A

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